September 15, 2019
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       Florida Senate - 2010                                     SB 878
       
       
       
       By Senator Thrasher
       
       
       
       
       8-00866A-10                                            2010878__
    1                        A bill to be entitled                      
    2         An act relating to notices of nonpayment in
    3         construction contracting; amending ss. 255.05, 337.18,
    4         and 713.23, F.S.; requiring a claimant to verify a
    5         notice of nonpayment submitted to a contractor or
    6         surety; specifying the information that must be
    7         included in a notice of nonpayment; prohibiting a
    8         person who furnishes a false or fraudulent notice of
    9         nonpayment from recovering under the surety bond;
   10         specifying the manner in which certain notices
   11         relating to construction contracting must be served;
   12         prohibiting a claimant from initiating an action for
   13         payment against a contractor or surety unless the
   14         claimant furnishes a notice that the claimant intends
   15         to look to the bond for protection and a notice of
   16         nonpayment in compliance with specified requirements;
   17         providing an effective date.
   18  
   19  Be It Enacted by the Legislature of the State of Florida:
   20  
   21         Section 1. Subsection (1) and paragraph (a) of subsection
   22  (2) of section 255.05, Florida Statutes, are amended to read:
   23         255.05 Bond of contractor constructing public buildings;
   24  form; action by materialmen.—
   25         (1)(a) Any person entering into a formal contract with the
   26  state or any county, municipality city, or political subdivision
   27  thereof, or other public authority or private entity, for the
   28  construction of a public building, for the prosecution and
   29  completion of a public work, or for repairs upon a public
   30  building or public work shall be required, before commencing the
   31  work or before recommencing the work after a default or
   32  abandonment, to execute and, deliver to the public owner, and
   33  record in the public records of the county where the improvement
   34  is located, a payment and performance bond with a surety insurer
   35  authorized to do business in this state as surety.
   36         (a) A public entity may not require a contractor to secure
   37  a surety bond under this section from a specific agent or
   38  bonding company.
   39         (b) The bond must state on its front page: the name,
   40  principal business address, and phone number of the contractor,
   41  the surety, the owner of the property being improved, and, if
   42  different from the owner, the contracting public entity; the
   43  contract number assigned by the contracting public entity; and a
   44  description of the project sufficient to identify it, such as a
   45  legal description or the street address of the property being
   46  improved, and a general description of the improvement.
   47         (c) Such bond shall be conditioned upon the contractor’s
   48  performance of the construction work in the time and manner
   49  prescribed in the contract and promptly making payments to all
   50  persons defined in s. 713.01 who furnish labor, services, or
   51  materials for the prosecution of the work provided for in the
   52  contract.
   53         (d) Any claimant may apply to the governmental entity
   54  having charge of the work for copies of the contract and bond
   55  and shall thereupon be furnished with a certified copy of the
   56  contract and bond. The claimant has shall have a right of action
   57  against the contractor and surety for the amount due him or her,
   58  including unpaid finance charges due under the claimant’s
   59  contract. Such action shall not involve the public authority in
   60  any expense.
   61         (e)1.A payment and performance bond is not required for a
   62  contract with the state for $100,000 or less. When such work is
   63  done for the state and the contract is for $100,000 or less, no
   64  payment and performance bond shall be required.
   65         2.At the discretion of The official or board awarding a
   66  such contract when such work is done for a any county,
   67  municipality city, political subdivision, or public authority
   68  may exempt a contract, any person entering into such a contract
   69  which is for $200,000 or less from the requirement for a may be
   70  exempted from executing the payment and performance bond.
   71         3.When such work is done for the state, The Secretary of
   72  Management Services may delegate to a state agency agencies the
   73  authority to exempt any person entering into such a contract for
   74  amounting to more than $100,000 but less than $200,000 from the
   75  requirement for a executing the payment and performance bond. If
   76  In the event such exemption is granted, the officer or officials
   77  are shall not be personally liable to persons suffering loss
   78  because of granting such exemption. The Department of Management
   79  Services shall maintain information on the number of requests by
   80  state agencies for delegation of authority to waive the bond
   81  requirements by agency and project number and whether any
   82  request for delegation was denied and the justification for the
   83  denial.
   84         (f) Any provision in a payment bond furnished for public
   85  work contracts as provided by this subsection which restricts
   86  the classes of persons as defined in s. 713.01 protected by the
   87  bond or the venue of any proceeding relating to such bond is
   88  unenforceable.
   89         (g)(b) The Department of Management Services shall adopt
   90  rules with respect to all contracts for $200,000 or less, to
   91  provide:
   92         1. Procedures for retaining up to 10 percent of each
   93  request for payment submitted by a contractor and procedures for
   94  determining disbursements from the amount retained on a pro rata
   95  basis to laborers, materialmen, and subcontractors, as defined
   96  in s. 713.01.
   97         2. Procedures for requiring certification from laborers,
   98  materialmen, and subcontractors, as defined in s. 713.01, prior
   99  to final payment to the contractor that such laborers,
  100  materialmen, and subcontractors have no claims against the
  101  contractor resulting from the completion of the work provided
  102  for in the contract.
  103  
  104  The state is shall not be held liable to any laborer,
  105  materialman, or subcontractor for any amounts greater than the
  106  pro rata share as determined under this section.
  107         (h)(c)1. The amount of the bond shall equal the contract
  108  price, except that for a contract in excess of $250 million, if
  109  the state, county, municipality, political subdivision, or other
  110  public entity finds that a bond in the amount of the contract
  111  price is not reasonably available, the public owner shall set
  112  the amount of the bond at the largest amount reasonably
  113  available, but not less than $250 million.
  114         2. For construction-management or design-build contracts,
  115  if the public owner does not include in the bond amount the cost
  116  of design or other nonconstruction services, the bond may not be
  117  conditioned on performance of such services or payment to
  118  persons furnishing such services. Notwithstanding paragraph (f)
  119  (a), such a bond may exclude persons furnishing such services
  120  from the classes of persons protected by the bond.
  121         (2)(a)1. If a claimant is no longer furnishing labor,
  122  services, or materials on a project, a contractor or the
  123  contractor’s agent or attorney may elect to shorten the
  124  prescribed time in this paragraph within which an action to
  125  enforce any claim against a payment bond must provided pursuant
  126  to this section may be commenced by recording in the clerk’s
  127  office a notice in substantially the following form:
  128  
  129                     NOTICE OF CONTEST OF CLAIM                    
  130                        AGAINST PAYMENT BOND                       
  131  To: ...(Name and address of claimant)...
  132         You are notified that the undersigned contests your notice
  133  of nonpayment, dated ............, ........, and served on the
  134  undersigned on ............, ........, and that the time within
  135  which you may file suit to enforce your claim is limited to 60
  136  days after the date of service of this notice.
  137         DATED on ............, .........
  138  Signed:...(Contractor or Attorney)...
  139  
  140  The claim of any claimant upon whom such notice is served and
  141  who fails to institute a suit to enforce his or her claim
  142  against the payment bond within 60 days after service of such
  143  notice shall be extinguished automatically. The clerk shall mail
  144  a copy of the notice of contest to the claimant at the address
  145  shown in the notice of nonpayment or most recent amendment
  146  thereto and shall certify to such service on the face of such
  147  notice and record the notice. Service is complete upon mailing.
  148         2.a. A claimant, except a laborer, who is not in privity
  149  with the contractor shall, before commencing or not later than
  150  45 days after commencing to furnish labor, services, or
  151  materials for the prosecution of the work, furnish the
  152  contractor with a written notice that he or she intends to look
  153  to the bond for protection.
  154         b. A claimant who is not in privity with the contractor and
  155  who has not received payment for his or her labor, services, or
  156  materials shall deliver to the contractor and to the surety
  157  written notice of the performance of the labor or services or
  158  delivery of the materials or supplies and of the nonpayment. The
  159  notice of nonpayment shall be verified and may be served at any
  160  time during the progress of the work or thereafter but not
  161  before 45 days after the first furnishing of labor, services, or
  162  materials, and not later than 90 days after the final furnishing
  163  of the labor, services, or materials by the claimant or, with
  164  respect to rental equipment, not later than 90 days after the
  165  date that the rental equipment was last on the job site
  166  available for use.
  167         (I) The notice of nonpayment must state, as of the date of
  168  the notice:
  169         (A) The nature of the labor or services performed and to be
  170  performed, if any;
  171         (B) The materials furnished and to be furnished, if known;
  172         (C) The amount paid on account, the amount due, and the
  173  amount to become due, if known; and Any notice of nonpayment
  174  served by a claimant who is not in privity with the contractor
  175  which includes sums for retainage must specify
  176         (D) The portion of the amount claimed for retainage, if
  177  any.
  178         (II) The notice of nonpayment must also include as
  179  attachments copies of the following documents to substantiate
  180  the amount claimed as unpaid:
  181         (A) The claimant’s contract or purchase order and any
  182  amendments or change orders directed thereto;
  183         (B) Invoices, pay requests, bills of lading, delivery
  184  receipts, or similar documents, as applicable; and
  185         (C) A statement of account reflecting all payments
  186  requested and received for the labor, services, or materials.
  187  
  188  A claimant who furnishes a false or fraudulent notice of
  189  nonpayment may not recover under the bond.
  190         (III) An No action for the labor, materials, or supplies
  191  may not be instituted against the contractor or the surety
  192  unless both notices have been given in full compliance with this
  193  subparagraph. Notices required or permitted under this section
  194  must may be served in accordance with s. 713.18. A claimant may
  195  not waive in advance his or her right to bring an action under
  196  the bond against the surety. In an any action brought to enforce
  197  a claim against a payment bond under this section, the
  198  prevailing party is entitled to recover a reasonable fee for the
  199  services of his or her attorney for trial and appeal or for
  200  arbitration, in an amount to be determined by the court, which
  201  fee must be taxed as part of the prevailing party’s costs, as
  202  allowed in equitable actions. The time periods for service of a
  203  notice of nonpayment or for bringing an action against a
  204  contractor or a surety shall be measured from the last day of
  205  furnishing labor, services, or materials by the claimant and may
  206  shall not be measured by other standards, such as the issuance
  207  of a certificate of occupancy or the issuance of a certificate
  208  of substantial completion.
  209         Section 2. Paragraph (c) of subsection (1) of section
  210  337.18, Florida Statutes, is amended to read:
  211         337.18 Surety bonds for construction or maintenance
  212  contracts; requirement with respect to contract award; bond
  213  requirements; defaults; damage assessments.—
  214         (1)
  215         (c)1. A claimant, except a laborer, who is not in privity
  216  with the contractor shall, before commencing or not later than
  217  90 days after commencing to furnish labor, materials, or
  218  supplies for the prosecution of the work, furnish the contractor
  219  with a notice that he or she intends to look to the bond for
  220  protection.
  221         2. A claimant who is not in privity with the contractor and
  222  who has not received payment for his or her labor, materials, or
  223  supplies shall deliver to the contractor and to the surety
  224  written notice of the performance of the labor or delivery of
  225  the materials or supplies and of the nonpayment. The notice of
  226  nonpayment shall be verified and may be served at any time
  227  during the progress of the work or thereafter but not before 45
  228  days after the first furnishing of labor, services, or
  229  materials, and not later than 90 days after the final furnishing
  230  of the labor, services, or materials by the claimant or, with
  231  respect to rental equipment, not later than 90 days after the
  232  date that the rental equipment was last on the job site
  233  available for use.
  234         a.The notice of nonpayment must state, as of the date of
  235  the notice:
  236         (I) The nature of the labor performed and to be performed,
  237  if any;
  238         (II) The materials or supplies furnished and to be
  239  furnished, if known;
  240         (III) The amount paid on account, the amount due, and the
  241  amount to become due, if known; and
  242         (IV) The portion of the amount claimed for retainage, if
  243  any.
  244         b. The notice of nonpayment must also include as
  245  attachments copies of the following documents to substantiate
  246  the amount claimed as unpaid:
  247         (I) The claimant’s contract or purchase order and any
  248  amendments or change orders directed thereto;
  249         (II) Invoices, pay requests, bills of lading, delivery
  250  receipts, or similar documents, as applicable; and
  251         (III) A statement of account reflecting all payments
  252  requested and received for the labor, materials, or supplies.
  253  
  254  A claimant who furnishes a false or fraudulent notice of
  255  nonpayment may not recover under the bond.
  256         3. An action by a claimant, except a laborer, who is not in
  257  privity with the contractor for the labor, materials, or
  258  supplies may not be instituted against the contractor or the
  259  surety unless both notices have been given in full compliance
  260  with this paragraph. Notices required or permitted under this
  261  section must may be served in any manner provided in s. 713.18.
  262         Section 3. Paragraph (d) of subsection (1) of section
  263  713.23, Florida Statutes, is amended to read:
  264         713.23 Payment bond.—
  265         (1)
  266         (d)1. In addition, a lienor is required, as a condition
  267  precedent to recovery under the bond, to serve a written notice
  268  of nonpayment to the contractor and the surety not later than 90
  269  days after the final furnishing of labor, services, or materials
  270  by the lienor. The notice of nonpayment shall be verified and
  271  may be served at any time during the progress of the work or
  272  thereafter but not before 45 days after the first furnishing of
  273  labor, services, or materials, and not later than 90 days after
  274  the final furnishing of the labor, services, or materials by the
  275  lienor or, with respect to rental equipment, not later than 90
  276  days after the date that the rental equipment was last on the
  277  job site available for use.
  278         2.The notice of nonpayment must state, as of the date of
  279  the notice:
  280         a. The nature of the labor or services performed and to be
  281  performed, if any;
  282         b. The materials furnished and to be furnished, if known;
  283         c. The amount paid on account, the amount due, and the
  284  amount to become due, if known; and
  285         d. The portion of the amount claimed for retainage, if any.
  286         3. For any lienor who is not in privity with the
  287  contractor, the notice of nonpayment must also include as
  288  attachments copies of the following documents to substantiate
  289  the amount claimed as unpaid:
  290         a. The lienor’s contract or purchase order and any
  291  amendments or change orders directed thereto;
  292         b. Invoices, pay requests, bills of lading, delivery
  293  receipts, or similar documents, as applicable; and
  294         c. A statement of account reflecting all payments requested
  295  and received for the labor, services, or materials.
  296  
  297  A lienor who furnishes a false or fraudulent notice of
  298  nonpayment may not recover under the bond.
  299         4. A written notice satisfies the this condition precedent
  300  in this paragraph with respect to the payment described in the
  301  notice of nonpayment, including unpaid finance charges due under
  302  the lienor’s contract, and with respect to any other payments
  303  that which become due to the lienor after the date of the notice
  304  of nonpayment. The time period for serving a written notice of
  305  nonpayment shall be measured from the last day of furnishing
  306  labor, services, or materials by the lienor and may shall not be
  307  measured by other standards, such as the issuance of a
  308  certificate of occupancy or the issuance of a certificate of
  309  substantial completion. The failure of a lienor to receive
  310  retainage sums not in excess of 10 percent of the value of
  311  labor, services, or materials furnished by the lienor is not
  312  considered a nonpayment requiring the service of the notice
  313  provided under this paragraph. An action for the labor,
  314  services, or materials may not be instituted against the
  315  contractor or the surety unless the notice of nonpayment has
  316  been given in full compliance with this paragraph. The notice
  317  under this paragraph may be in substantially the following form:
  318                        NOTICE OF NONPAYMENT                       
  319  
  320  To ...(name of contractor and address)...
  321  
  322  ...(name of surety and address)...
  323  
  324  The undersigned notifies you that he or she has furnished
  325  ...(describe labor, services, or materials)... for the
  326  improvement of the real property identified as ...(property
  327  description).... The amount now due and unpaid is $.....
  328  ...(signature and address of lienor)...
  329         Section 4. This act shall take effect July 1, 2010.

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